This Document is the Property of His Britannic Majesty's Government.
C.O.
5316
AFFAIRS OF CHINA.
CONFIDENTIAL.
Not
[December 6.]
SECTION
R14 FEB 06
64
Consul-General Fraser to the Marquess of Lansdowne.-(Received December 6.)
(No. 5.) My Lord,
Hankow, October 31, 1905.
I HAVE the honour to forward copy of a despatch which I have this day addressed to His Majesty's Minister at Peking,
I have, &c.
(Signed)
E. H. FRASER.
~Inclosure in No. 1-
Consul-General Fraser to Sir E. Satow.
(No. 54. Very Confidential.) Sir,
Hankow, October 31, 1905.- I HAVE the honour to report a message, conveyed to me in strict confidence from the Viceroy Chang, through his Chief Secretary Wang, yesterday evening, on the subject of the loans for the Hankow-Canton and the Hupei section of the Szechuan-Hankow railways, which his Excellency has desired to arrange with British financiers.
The former loan was mooted by his Excellency Chang early in the course of his negotiations for British aid in the resumption of the China Development Company's Concession, but the strong views of the Hunan gentry prevented details being gone into, and ultimately led the Viceroy to meditate, as a first step, the building of the short Hupei section of the southern trunk line.
When I accompanied Messrs. Hillier and Ross on their visit to his Excellency Chang on the 12th instant they were prepared to offer to float a loan of 1,000,000l. for the construction of this section, and the paying-off of the bonds issued by the China Development Company, which are mostly in Belgian hands. His Excellency informed us, however, that all construction loans for the Hankow-Canton line had been strictly forbidden, owing to the Belgian and French Ministers having set up a claim on behalf of the builders of the Pei-Han line to prior right to construct that line.
I pointed out on what a flimsy basis such a claim rested, and was assured that the Chinese Government had absolutely refused to entertain it, but that the Wai-wu Pu had been moved by this action of the Belgians and French to support the advocates of building this railway only with native capital.
The Viceroy treated the delay thus caused as only a temporary obstacle, but said its existence prevented any discussion except as to the Hupei section of the Szechuan-Hankow line.
In the conversation that followed, the terms of a satisfactory arrangement were sketched out, leaving only the question of the net price to be paid his Excellency for further discussion.
On the 18th instant I sent the Viceroy a Chinese translation of those terms as noted down by Mr. Ross, and a detailed Memorandum based on the explanations of Mr. Hillier, as to the cost of floating a loan on the London market. The latter was designed to show his Excellency that the 94 per cent. offered was not a low figure, and I added that it might be slightly raised if the other terms were agreed to.
His Excellency presently replied that the note of terms needed some modification, and so soon as he could get approval of the loan from his Government he would send his secretaries to talk the matter over.
On the evening of the 25th instant Mr. Wang sent me a confidential note explaining that the Viceroy must be sure of a decree of approval before he concluded an Agreement, and that he was trying by telegram to overcome the clamour in Peking in favour of using Chinese capital for railway building,
Yesterday evening Mr. Wang called to tell me, from his Excellency Chang, that there is at present no hope of obtaining sanction for any foreign loan for railway purposes.
[2295 ƒ-3]
2
Page 64
Page 65
This Document is the Property of His Britannic Majesty's Government.}
C.0.
5316
AFFAIRS OF CHINA.
CONFIDENTIAL.
Not
[December 6.]
SECTION
R14 FEB 06
64
Consul-General Fraser to the Marquess of Lansdowne.-(Received December 6.)
(No. 5.) My Lord,
Hankow, October 31, 1905.
I HAVE the honour to forward copy of a despatch which I have this day addressed to His Majesty's Minister at Peking,
I have, &c.
(Signed)
E. H. FRASER.
~Inclosure in No. 1-
Consul-General Fraser to Sir E. Sutou.
(No. 54. Very Confidential.) Sir,
Hankow, October 31, 1905.- I HAVE the honour to report a message, conveyed to me in strict confidence from the Viceroy Chang, through his Chief Secretary Wang, yesterday evening, on the subject of the loans for the Hankow-Canton and the Hupei section of the Szechuan- Hankow railways, which his Excellency has desired to arrange with British financiers.
The former loan was mooted by his Excellency Chang early in the course of his negotiations for British aid in the resumption of the China Development Company's Concession, but the strong views of the Hunan gentry prevented details being gone into, and ultimately led the Viceroy to meditate, as a first step, the building of the short Hupei section of the southern trunk line.
When I accompanied Messrs. Hillier and Ross on their visit to his Excellency Chang on the 12th instant they were prepared to offer to float a loan of 1,000,0001. for the construction of this section, and the paying-off of the bonds issued by the China Development Company, which are mostly in Belgian hands. His Excellency mformed us, however, that all construction loans for the Hankow-Canton line had been strictly forbidden, owing to the Belgian and French Ministers having set up a claim on behalf of the builders of the Pei-Hau line to prior right to construct that line.
I pointed out on what a flimsy basis such a claim rested, and was assured that the Chinese Government had absolutely refused to entertain it, but that the Wai-wu Pu had been moved by this action of the Belgians and French to support the advocates of building this railway only with native capital.
The Viceroy treated the delay thus caused as only a temporary obstacle, but said its existence prevented any discussion except as to the Hupei section of the Szechuan- Hankow line.
In the conversation that followed, the terms of a satisfactory arrangement were sketched out, leaving only the question of the net price to be paid his Excellency for further discussion.
On the 18th instant I sent the Viceroy a Chinese translation of those terms as noted down by Mr. Ross, and a detailed Memorandum based on the explanations of Mr. Hillier, as to the cost of floating a loan on the London market. The latter was designed to show his Excellency that the 94 per cent. offered was not a low figure, and I added that it might be slightly raised if the other terms were agreed to.
His Excellency presently replied that the note of terms needed some modification, and so soon as he could get approval of the loan from his Government he would send his secretaries to talk the matter over.
On the evening of the 25th instant Mr. Wang sent me a confidential note explaining that the Viceroy must be sure of a decree of approval before he concluded an Agreement, and that he was trying by telegram to overcome the clamour in Peking in favour of using Chinese capital for railway building,
Yesterday evening Mr. Wang called to tell me, from his Excellency Chang, that there is at present no hope of obtaining sanction for any foreign loan for railway
purposes.
[2295 ƒ-3]
2
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